A necessary reform of agriculture market access rules

• DOI: https://doi.org/10.1108/JITLP-06-2019-0030
• Pages: 101-120
• Published date: 30 June 2020
• Date: 30 June 2020
• Author: Ismaelline Eba Nguema
• Subject Matter: Strategy,International business,International business law,Economics,International economics,International trade

A necessary reform of agriculture

market access rules

Ismaelline Eba Nguema

Department of Public Law, Faculty of Law and Economics,

Omar Bongo University, Libreville, Gabon

Abstract

Purpose –The purpose of this paper is to demonstrateby text and empirical facts, the need to reform the

rules in force.

Design/methodology/approach –This study confronts current standards with empirical facts. To

do this, it is postulated that even though current market access standards are better that the Gatt 1947

rules, they leave the possibility for some members to hijack them to eventually increase their protection

effective tariff.

Findings –Market access standards for agricultural products should be reformed because of their

asymmetry. To put an end to this asymmetry, these standards should be rebalanced. This is precisely the

challengeof the current multilateral negotiations.

Originality/value –Unlike the studies conducted on this subject (to my knowledge), which are mainly

based on economicor political science methods, this analysisis essentially based on legal reasoning law.

Keywords Market access, AoA, Poorest members, Richest members

Paper type Research paper

1. Introduction

At the launch of the Uruguay Round, the contracting parties declared their willingness to

proceed with the insertionof “underdeveloped”parties in international trade[1]. To this end,

access to the market for agricultural products has been considered as one of the pillars of

“fair”trade. The risein the price of food imports should (in principle) be offset byan increase

in their export earnings. However, several years after the end of the Uruguay Round,

participation in international trade in some regions has declined (especially in the least

developed regions like Africa).Conversely, many African countries became net importersof

food without increasingtheir export earnings [2]. The 2008 food crisis highlightedthe failure

of the poorest economies to access the world market. While the rich countries were able to

take advantage of the liberalization(started since 1980) of small economies, it seems that the

agricultural markets of the latter remained “hermetic”. This finding led many analysts to

question the progress World Trade Organization (WTO) members made in terms of market

access for agricultural products. Behind the “principle”, it seems that the “exception”is the

rule [3]. This is at least the deduction that can be made of criticisms that have been made

against the rules in force (Chinotti, 2004;Supper, 2000). However, the adoption of the draft

modalities on agriculture, the introduction of the special safeguard mechanism (SSM) for

developing countries or even the optimal application of the Bali decision on duty-free and

quota-free (DFQF) market accessfor least-developed countries could pave the way for more

equitable agriculturalliberalization.

Author like to thank the reviewers and Prof. Joseph McManon for allowing me to greatly improve

this paper.

Necessary

reform of the

agriculture

market

101

Received7 June 2019

Revised29 September 2019

15January 2020

9 May2020

Accepted1 June 2020

Journalof International Trade

Lawand Policy

Vol.19 No. 2, 2020

pp. 101-120

© Emerald Publishing Limited

1477-0024

DOI 10.1108/JITLP-06-2019-0030

The current issue and full text archive of this journal is available on Emerald Insight at:

https://www.emerald.com/insight/1477-0024.htm

Besides, some studiesconfirm this reasoning.

In a detailed analysis of the agreement on agriculture (AoA), McMahon concluded that

existing standards for market access remain incomplete (McMahon, 2007). In fact, these

have not led to an effective reduction of tariff and non-tariff protection. Nevertheless, he

considers that in accordance with the AoA long-term goal, the Doha Round provides an

opportunity for members to rebalance existing standards and move further towards

agricultural tradeliberalization.

Focussing on the North-South imbalances induced by the AoA, Cardwell and Smith

show in their analysis that market access standards have benefited only a few members

(mainly developed countries) (Cardwell and Smith, 2013). On the other hand, they note that

the current negotiations could lead to a rebalancing of the standards in force. This would

improve the economic andsocial situation of developing members, especially the poorest.

In contrast to the studies mentioned above, this analysis focusses mainly on market

access for agricultural products. Nevertheless, while analyzing the standards in this area,

this study also analyses the interaction between market access and the other two pillars of

AoA, namely, domesticsupport and export subsidy. This study confronts current standards

with empirical facts.

To do this, it is postulated that even though current market access standards are better

than the GATT 1947 rules, they leave the possibility for some members to hijack them to

eventually increasetheir protection tariffs.

To support this hypothesis, we will begin by analyzing the draft modalities;

While it seems that this text contains the bases for a more equitable regulation, the

first decisions adopted during the Doha Round seem to have mixed results. This is

particularly the case with the Bali decision on tariff quotas;

In addition to tariff quotas, a set of tariff measures is currently deployed;

Market access also depends on better regulation of non-tariff barriers;

Yet, it seems that the SSM may offer better market access conditions; and

Finally, it will become clear that, in addition to fairer agricultural rules, better

market access for the poorest countries also depends on their ability to improve

their trade performance.

2. Draft modalities: towards a better opening of agricultural markets?

The current market accessdraft appears to differ in some respects from the disciplines of the

AoA. In this draft, the members proposenot only to further reduce bound tariffs but also to

soften the effects of tariff escalation on agricultural imports. To do this, members have

chosen to use a tiered reduction formula(i.e. the reduction will be greater for members with

the highest bound rates).

Members shall reduce their consolidatedrates in six annual installments over a five-year

period, as follows:

if the final bound tariff or ad valorem equivalent is greater than zero and less than or

equal to 20%, the reduction shall be 50%;

if the final bound tariff or ad valorem equivalent is greater than 20% and less than

or equal to 50%, the reduction shall be 57%;

if the final bound tariff or ad valorem equivalent is greater than 50% and less than

or equal to 75%, the reduction shall be 64%; and

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